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article imageStudy says US biofuels policies flawed

By Bob Ewing     Jan 6, 2010 in Business
Rice University policy paper says U,S. needs to rethink its policy of promoting ethanol to diversify its energy sources and increase energy security.
The paper, "Fundamentals of a Sustainable U.S. Biofuels Policy," challenges the terms used to allocate billions of dollars in federal subsidies and protectionist tariffs that go to domestic ethanol producers yearly.
The University media release quotes Amy Myers Jaffe, one of the report's authors, "We need to set realistic targets for ethanol in the United States instead of just throwing taxpayer money out the window."
Jaffe is a fellow in energy studies at the Baker Institute and associate director of the Rice Energy Program.
In 2008, the report, for example, states, “the U.S. government spent $4 billion in biofuels subsidies to replace roughly 2 percent of the U.S. gasoline supply. The average cost to the taxpayer of those 'substituted' barrels of gasoline was roughly $82 a barrel, or $1.95 per gallon on top of the retail gasoline price (i.e., what consumers pay at the pump)."
The authors ask whether or not biofuels are improving the environment or energy security.
"Increases in corn-based ethanol production in the Midwest could cause an increase in detrimental regional environmental impacts," the study states, "including exacerbating damage to ecosystems and fisheries along the Mississippi River and in the Gulf of Mexico and creating water shortages in some areas experiencing significant increases in fuel crop irrigation."
The authors also question claims ethanol use lowers greenhouse gas (GHG) emissions, writing, " There is no scientific consensus on the climate-friendly nature of U.S.-produced corn-based ethanol, and it should not be credited with reducing GHGs when compared to the burning of traditional gasoline."
The media release says the report's authors wrote, "We encourage Congress to revisit these mandates and revise them to be in line with realizable targets and time frames to create an improved policy that will reduce uncertainty for refiners and allow a more orderly implementation of achievable goals and mandates by the EPA."
The study was supported by a research grant in environmental engineering from Chevron Technology Ventures.
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